Volatility of Price Indices for Heterogeneous Goods with Applications to the Fine Art Market

Price indices for heterogeneous goods such as real estate or fine art constitute crucial information for institutional or private investors considering alternative investment decisions in times of financial markets turmoil. Classical mean‐variance analysis of alternative investments has been hampered by the lack of a systematic treatment of volatility in these markets. In this paper we propose a hedonic regression framework which explicitly defines an underlying stochastic process for the price index, allowing to treat the volatility parameter as the object of interest. The model can be estimated using maximum likelihood in combination with the Kalman filter. We derive theoretical properties of the volatility estimator and show that it outperforms the standard estimator. We show that extensions to allow for time‐varying volatility are straightforward using a local‐likelihood approach. In an application to a large data set of international blue chip artists, we show that volatility of the art market, although generally lower than that of financial markets, has risen after the financial crisis of 2008–09, but sharply decreased during the recent debt crisis. Copyright © 2013 John Wiley & Sons, Ltd.     

Management in the “neo-paternalistic organization”: The case of worksite health promotion at Scania

This paper proposes a qualitative study of Work Site Health Promotion (WHP) at the large Swedish producer of trucks and buses, Scania. While the concept of WHP implies that it is employees’ improved health at work that is strived for, we suggest that its main area of intervention is neither the work environment, nor what employees do at work, but employees’ lifestyles. To capture the potential of WHP for the management of organization, we introduce the concept of “neo-paternalistic organizational control.” By this term we want to draw attention to how WHP shares paternalistic approaches’ tendency of disregarding the professional-private divide, while also drawing attention to how this extra-professional control dimension is at once less intrusive and more discriminatory than what is traditionally referred to as paternalism in the literature on managerial control.     

A decision support system to investigate dynamic last-mile distribution facilitating cargo-bikes

This work presents a decision support system to facilitate efficient urban last-mile distribution. Orders are collected and delivered by a fleet of both conventional vehicles owned by a logistics provider and cargo-bikes operated by freelancers. Additionally, micro-hubs are operated to perform transshipments between multiple vehicles. To investigate the corresponding problem setting, an agent-based simulation is developed, which uses dynamic optimisation procedures to generate and select vehicle routes and transshipment points. Experiments motivated by dynamic real-world urban restaurant delivery services investigate the impact of cargo-bikes, urban consolidation and guaranteed delivery times. Potentials are discussed and implications for successful implementations are provided. Results highlight the importance of having a sufficient number of active cargo-bikes available and benefits of incorporating consolidation strategies to guarantee timely deliveries.     

Urban Informality and the State: Geographical Translations and Conceptual Alliances

Understandings of informality commonly derive from research undertaken in states perceived as lacking the capacity to regulate the practices of their populations. This Interventions forum aims to expand the geographical parameters of empirical research on urban informality. A more global approach, we argue, also necessitates questioning assumptions that undergird this concept—in particular the underlying conception of the state. In this vein, this collection of papers aims to rethink theories of the state through the lens of informality, and vice versa, to inform and refine the concept of informality through a more thorough understanding of states. In so doing, the contributions engage with concepts that have been central both to theories of the state and to the study of informality, namely governance, agency, legitimacy, sovereignty and legality. Following this introduction setting out our theoretical approach, the Interventions forum unites five empirical studies that discuss the nexus of informality and states in contexts that have been researched less extensively from this perspective, each tackling one of the above‐mentioned concepts. Based on these different entry points, the papers provide novel angles on a state‐theoretical understanding of informality. A concluding essay brings these approaches together, reflecting on the possibilities of translating concepts to different sites.     

Does global inflation help forecast inflation in industrialized countries?

Ciccarelli and Mojon (CM; Review of Economics and Statistics, 2010, 92(3), 524–535) propose an inflation forecasting model incorporating a global inflation factor and show that it consistently beats several standard forecasting benchmarks. We show that CM's global inflation model does not improve upon the Atkeson and Ohanian (AO; Federal Reserve Bank of Minneapolis Quarterly Review, 2001, 25(1), 2–11) naive benchmark. However, we find that augmenting the AO model with a global inflation factor improves forecast accuracy at longer horizons, supporting CM's claim about the usefulness of global inflation.     

Leading public service organizations: how to obtain high employee self-efficacy and organizational performance

Concerns are sometimes raised that transactional leadership harms public organizations’ performance because demands thwart employees’ self-efficacy. However, the opposite may be argued – conditional rewards strengthen feelings of competence because they provide positive feedback on performance. We study ninety-two high school principals’ reported use of contingent rewards and sanctions and self-efficacy among their 1,932 teachers. The results indicate that contingent rewards strengthen self-efficacy, and that sanctions are not negatively related with self-efficacy or performance. Furthermore, the teachers’ self-efficacy can be linked positively to organizational performance. This suggests that rewards can be an important tool for managers in the public sector.     

The Spectrum of Random Matrices

The Frobenius eigenvector of a positive square matrix is obtained by iterating the multiplication of an arbitrary positive vector by the matrix. Bródy (1997) noticed that, when the entries of the matrix are independently and identically distributed, the speed of convergence increases statistically with the dimension of the matrix. As the speed depends on the ratio between the subdominant and the dominant eigenvalues, Bródy's conjecture amounts to stating that this ratio tends to zero when the dimension tends to infinity. The paper provides a simple proof of the result. Some mathematical and economic aspects of the problem are discussed.